Oil prices decline in early trade

18 May 2023 , 08:37 AM

Thursday saw a little decline in oil prices as supply concerns subsided after the previous session’s over 3% increase.

Futures for Brent crude decreased by 24 cents to $76.72 a barrel. West Texas Intermediate crude for the United States fell 21 cents to $72.62.

On Wednesday, both benchmarks increased by close to 3% thanks to hope for the oil market and the ongoing talks over the US debt ceiling.

U.S. oil stocks unexpectedly increased last week as a result of another release from the Strategic Petroleum Reserve, which put pressure on prices. In the week ending May 12, crude inventories increased by 5 million barrels to 467.6 million barrels, going against the 900,000-barrel decline predicted by analysts in a Reuters poll.

Nevertheless, while demand rose to its highest level since 2021, U.S. petrol inventories shrank.

Investors are keeping an eye on the progress of the US debt ceiling talks.

President Joe Biden and top Republican in Congress Kevin McCarthy, meantime, reaffirmed their resolve on Wednesday to quickly negotiate an agreement to raise the federal government’s $31.4 trillion debt ceiling and prevent an unthinkable economic default.

The Democratic president and House speaker finally agreed to direct talks on Tuesday after a protracted impasse. Before June 1—as soon as that—the federal government runs out of money to pay its debts, both chambers of Congress must come to an agreement and pass it.

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